The Unified Payments Interface (UPI for business) is a digital payment system in India that enables seamless and instant money transfers between bank accounts and businesses through mobile devices. The revolutionary payment system simplifies transactions by eliminating the need to enter card numbers or net banking details every time you make a transaction.
No wonder UPI is the most popular digital payment method in India. In FY 2023, UPI accounted for a massive 84% of India’s digital transactions. Projections suggest it’ll jump to a whopping 90% by FY 2026.
But UPI isn’t just for people; it’s changing the game for corporations and small businesses as well. A whopping 70% of MSMEs believe more than half their retail sales will happen via UPI.
Join us as we break down UPI for business, exploring its mechanics and the benefits it could bring to your financial game.
How does UPI work for business?
UPI simplifies business transactions by enabling seamless fund transfers. To get started, a business needs to register with a bank supporting UPI. Upon registration, the business is assigned a unique UPI ID. Customers can use any UPI-enabled app to make UPI payments to businesses.
The biggest perk of using UPI is that customers can initiate the payment by simply using the UPI ID or scanning a UPI QR code. This eliminates the need for traditional banking processes like entering account numbers and branch codes. The UPI system securely connects the payer and payee banks, ensuring quick and reliable fund transfers.
There are mainly two types of payments that UPI supports:
Push payments
Push payments occur when customers initiate transactions by using their UPI-enabled apps to push funds from their bank accounts to the business. This method is commonly seen in retail transactions, bill payments, and other scenarios where customers take the lead in completing transactions.
Collect requests
If businesses want to initiate the payment process, they often leverage the collect request feature. Here, the business sends a collect request to the customer via UPI, specifying the amount owed. This convenient feature allows businesses to efficiently manage receivables and enhance the overall payment experience for customers.
Setting up UPI for business
To register for UPI, all that’s required is an operating bank account number and an IFSC code. When setting up UPI for business, it’s essential to link a current account. Here’s a step-by-step guide:
- Use your bank’s official UPI-enabled app or a third-party UPI app. Follow the on-screen instructions to create a UPI account.
- Link your bank to your UPI account by providing the necessary details, including your account number and IFSC code.
- Complete the registration by verifying your bank account through a one-time password (OTP) sent to your registered mobile number.
- Once verified, a unique UPI ID will be assigned. Share this virtual ID with customers for seamless transactions.
- For online businesses, seamlessly integrate UPI payment options on your website or app through a reliable UPI payment gateway.
Options for businesses accepting UPI payments
For businesses using UPI, there are different ways to make payments smooth. Here are some options businesses can use to make or accept payments via UPI:
UPI QR codes
UPI QR codes have become a convenient payment mode, especially in physical stores. These codes enable customers to effortlessly scan and complete payments using their UPI-enabled mobile apps. The quick and contactless nature of UPI QR codes enhances the overall payment experience.
UPI payment links
Businesses can generate UPI payment links, offering a versatile solution for online transactions. These links, shareable through messages, emails, or websites, provide customers with a convenient way to initiate payments. UPI payment links are particularly advantageous for online businesses looking for flexibility across various communication channels.
UPI-enabled POS terminals
Point-of-sale (POS) terminals equipped with UPI functionality empower businesses to accept payments directly. This is especially beneficial for physical stores and service providers, as it integrates seamlessly into existing POS infrastructure, offering an efficient in-person payment solution.
UPI apps and in-app payments
Businesses with a digital presence can simplify transactions by integrating UPI-enabled apps like Google Pay and PhonePe into their applications. This allows customers to conveniently make purchases or pay for services within the app, improving the overall user experience in the digital space.
Payment gateway integration with UPI
Online businesses can seamlessly incorporate UPI payment options into their websites using payment gateways. Plural Payment Gateway, for example, provides a comprehensive UPIverse tailored for businesses equipped with the latest UPI features and offerings. By adopting such solutions, businesses can ensure smooth UPI payments for their customers.
UPI autopay
UPI Autopay is a valuable option for businesses offering subscription-based services. With customer consent, this feature enables the establishment of recurring payments, streamlining processes for businesses, and enhancing user convenience for regular payments and subscriptions.
Benefits of UPI for Business
The adoption of UPI brings several noteworthy benefits for businesses, revolutionising the way transactions are conducted. Here are some significant advantages of UPI for businesses:
Instant fund transfers
UPI enables real-time money transfers, allowing businesses to send and receive funds instantly, 24/7, including weekends and holidays.
Simplified transactions
UPI simplifies fund collection using a single identifier, the UPI ID. Customers can transact seamlessly without entering complex details like account numbers or card information, streamlining the payment process for businesses.
Cost-effective
UPI transactions typically have lower transaction costs compared to traditional payment methods, such as credit cards and wire transfers.
Financial inclusion
UPI’s inclusive nature allows businesses to accept payments from customers without credit or debit cards. This widens the customer base, ensuring that individuals without debit or credit cards can also make digital transactions.
Enhanced security
The use of virtual IDs in UPI transactions enhances security by eliminating the need to share sensitive information like account numbers, IFSC, card details, etc., during payments. Further, there is no risk of businesses storing sensitive card information of users.
Automatic payment reminders
Businesses can set up automatic payment reminders for customers, reducing the chances of delayed payments and improving cash flow management.
API integration
Payment APIs (Application Programming Interfaces) allow businesses to integrate UPI functionality into their apps, websites, or systems, providing a customised payment experience.
Reduced cash handling costs
Adopting UPI can help businesses minimise the costs associated with cash handling, such as transportation, storage, and security.
Quick and efficient collections
Businesses can use UPI for quick and efficient collections, especially in scenarios like subscription-based services or recurring payments.
Wrapping up
UPI emerges as a pivotal force driving transformation in the realm of business. Its manifold advantages, including streamlined transactions, cost-effectiveness, enhanced security, and financial inclusivity, have propelled it to the forefront of modern commerce.
Plural Gateway amplifies these benefits even further, providing an unparalleled UPI payment gateway experience. Offering a diverse array of UPI options and the capability to accept payments via social media platforms, we ensure seamless transactions for businesses of all sizes.
Moreover, with our Affordability Suite, we extend a plethora of additional payment options, such as card EMIs, cardless EMIs, brand EMIs, buy now, pay later, and more. Coupled with our effortless integration process and unwavering support, we stand ready to become your strategic partner in fostering business growth.
Write to us at pgsupport@pinelabs.com or simply click below to discover the transformative potential of the Plural Payment Gateway and revolutionise your business operations.
Plural by Pine Labs has received an in-principle authorisation from the Reserve Bank of India (RBI) to operate as a payment Aggregator.
